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Intel shifts foundry strategy to compete directly with TSMC
Friday, March 6, 2026 at 06:53 AM
Intel is reportedly restructuring its internal foundry business model to operate as a standalone unit, aiming to directly compete with TSMC's manufacturing services and attract external chip designers for its advanced process nodes.
Context
In a pivotal shift for the semiconductor industry, Intel has transitioned to a new internal foundry operating model to compete directly with TSMC and Samsung. This strategy, formalized in early 2024, establishes Intel Foundry as a distinct segment with its own financial reporting and a target to become the world's second-largest foundry by 2030. The goal is to drive greater transparency and cost savings by charging internal product groups market-based prices for manufacturing.
A cornerstone of this competition is the Intel 18A process node, which is on track for production in 2025. This node aims to leapfrog TSMC's leadership by utilizing RibbonFET and PowerVia technologies before similar 2nm-class nodes from rivals. While the foundry business currently faces heavy losses, including an $8.2 billion operating loss in 2025, Intel expects to reach break-even margins by the end of 2030 with a 40% non-GAAP gross margin target.
Sources (6)
Intel Outlines Financial Framework for Foundry Business, Sets Path to Margin Expansion - Intel Newsroom[PDF] 2024 Fourth-Quarter and Full-Year Earnings Release - IntelDocument - SEC.govintc-20250927Intel's 18A production starts before TSMC's competing N2 tech — here's how the two process nodes compare | Tom's Hardware[PDF] Q3+24_EarningsRelease.pdf - Cloudfront.net
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